Retirement Income Planning
Pension Strategies
If you're lucky enough to have a pension, the choices you make at retirement can shape your income — and your spouse's — for the rest of your lives.
Lump Sum vs Lifetime Income
Many pensions offer a one-time lump sum or a stream of monthly payments for life. Each has trade-offs in flexibility, longevity protection, and survivor benefits.
Single Life vs Joint Life
Single-life options pay more, but stop at your death. Joint-life options pay less but continue to a surviving spouse. The right choice depends on age difference, health, and other income.
Pension Maximization
Some retirees take the higher single-life payout and use part of it to purchase life insurance protecting the spouse. This strategy can work — but requires careful underwriting and stable health.
Should You Roll It Over?
Rolling a lump sum to an IRA gives flexibility and investment control but transfers longevity risk to you. Keeping the pension transfers that risk to the plan sponsor.
The Bottom Line
Pension elections are one of the most important — and irreversible — decisions in retirement. Run the numbers carefully and consider all sources of income together.